ChemChina Offers More Than $43 Billion to Acquire Syngenta

Government-owned ChemChina has offered to acquire Swiss rival Syngenta for more than $43 billion in cash, marking the largest foreign acquisition by a Chinese company.

The deal, which is expected to close by the end of the year, includes $465 per share plus a special dividend of CHF 5 (about $5) to be paid conditional upon and prior to closing. Syngenta shareholders will also receive the proposed ordinary dividend of CHF 11 in May 2016.

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Syngenta said its existing management will continue to run the company. After closing, a 10-member board of directors will be chaired by Ren Jianxin, Chairman of ChemChina, and will include four of the existing Syngenta Board members. ChemChina is committed to “maintaining the highest governance standards with a view to an IPO of the business in the years to come,” Syngenta said.

Ren Jianxin, Chairman of ChemChina, said: “The discussions between our two companies have been friendly, constructive and co-operative, and we are delighted that this collaboration has led to the agreement announced today. We will continue to work alongside the management and employees of Syngenta to maintain the company’s leading competitive edge in the global agricultural technology field.” He added: “Our vision is not confined to our mutual interests, but will also respond to and maximize the interests of farmers and consumers around the world. We look forward to Michel Demaré remaining on the Board as Vice Chairman and lead independent director, and to working with John Ramsay and the management and employees of Syngenta to deliver safe and reliable solutions for the continued growth in global food demand.”

The transaction will enable further expansion of Syngenta’s presence in emerging markets and notably in China, Syngenta said.

Syngenta said its board of directors considers that the proposed transaction respects the interests of all stakeholders and is unanimously recommending the offer to shareholders. It added that there is committed financing for the deal and a strong commitment to pursue regulatory clearances. A Swiss and U.S. tender offer will commence in the coming weeks and the transaction is expected to conclude by the end of the year.

Dyalco, J.P. Morgan, Goldman Sachs and UBS served as financial advisors to Syngenta on the transaction. Bär & Karrer and Davis Polk served as legal advisors.